Singapore Airlines’ strongly embedded positioning and commitment to the brand has positioned it well to compete in the new landscape. The chal- lenge is to stay true to the brand and keep delivering on the fairly high-cost promise of quality, innovation and service. This requires heavy, ongoing investments and healthy cash flows which can only be achieved through a continuous price premium strategy and satisfactory passenger load factors.
In other words, customers’ perception of the price/value equation, their future buying behavior (partly to be influenced by the low-cost carriers) and loyalty, among other factors, are crucial for the future.
In most industries, there are always segments willing to pay for quality brands. Therefore, the question is not whether there are customers in the market for higher value airlines, but rather the ability for SIA to constantly nurture the brand promise, keep innovating and capture the overall value of the brand in the minds of the customers.
The strong brand equity of Singapore Airlines is one of the most valuable assets for the company and its cash-rich balance sheet. Singapore Airlines is an interesting business case from Asia demonstrating the importance of having strategic branding on the boardroom agenda. The airline can serve as valuable inspiration for other Asian companies trying to build and extract value from their own brands. Singapore Airlines is among the top compa- nies globally that are truly able to control the brand through every interac- tion and experience. SIA has become a hugely rewarded innovator and industry leader: “A Great Way to Fly”.
CASE 2
Successful Asian brand cases
139experience with the local history, culture and heritage, Amanresorts has been able to create a real world paradise. As with most iconic brands in the world, Amanresorts was also guided by its visionary founder and chairman, Dutch-Indonesian Adrian Zecha, and his clear-cut business strategy right from the start.
The brand equity was built by creating a strong and distinct personality in line with the organization’s philosophy. The management team, led by Adrian Zecha, has ensured a continuous investment in all aspects of the brand to ensure consistent delivery of Amanresorts’ brand promises.
Background
Amanresorts was born out of Adrian Zecha’s strong contempt toward the corporatization of the hotel and resort industry. The first of the Amanresorts was started in Phuket, Thailand in December 1987 and it was called Aman- puri. Based on its founding philosophy, Amanpuri had fewer than 50 rooms as against the over 400-room norms of the big hotel chains. This was part of Paradise on earth – sea, sun, and luxury at Amanwella (Sri Lanka) Courtesy Amanresorts
the strategy. By having fewer than 50 rooms in each of the Amanresorts, the company has been consistently able to provide a world-class personalized service to every guest. Amanresorts runs one of the highest yields per room in the entire industry.
As Adrian Zecha once said: “The whole point is to keep things as not institutional as possible.”12The strategy has been so successful that today Amanresorts has its “pieces of paradise” spread across 11 countries – France, Indonesia, French Polynesia, Thailand, Cambodia, Morocco, Philip- pines, USA, India, Bhutan and Sri Lanka, with more in the pipeline.
The right location is the key factor in the hotel industry and, particularly for a luxury brand like Amanresorts, it simply defines the success of the company. Adrian Zecha is known for being a great site locator and has an impeccable nose for future sites. He said Croatia would become the next hot destination in Europe while the Balkan war was still tearing countries apart. Many of the greatest and often hidden locations in the world reside with old families who only rarely consider selling their heritage jewels.
When they do decide to sell, it is very likely Zecha will get the first call, due to his reputation and exclusive network. Said Anil Thadani, Amanresorts’
co-founder: “If someone called from Brazil for example, and said that they had a beautiful site, Adrian Zecha would not hesitate to fly off to see the location the same day. He is known for that.”13
Brand philosophy
Amanresorts has emerged as one of the iconic brands of the global hospital- ity industry. Apart from a proactive and supportive top management, the other main factor contributing to the brand’s success has been a dedicated alignment of the corporate vision with the branding strategies and programs.
Amanresorts’ corporate strategy and hence its branding strategy has been built on four main pillars:
■ Keeping the resorts non-institutional
■ Providing guests with a luxury private home and not a mere hotel
■ Offering its visitors a holistic holiday experience by combining luxury with the unique heritage and culture of the resort location
■ Maintaining a high level of exclusivity.
Successful Asian brand cases
141Non-institutional
Right from the start, Amanresorts has striven to be as unlike a typical commercial resort chain as possible. The owners’ aversion toward the corporatization of the hotel industry has led to a unique work culture and atmosphere within Amanresorts. With the objective of providing an excel- lent personalized service to all its guests, staff members are constantly urged to be as innovative and creative in their service as possible to make every interaction with the guests a memorable experience. Most of the managerial and other staff that Amanresorts recruits are primarily people who have had no experience in the hotel industry but possess the right atti- tude and the ability to conform to the Amanresorts’ culture. This is strictly adhered to, as Amanresorts believes that people with no experience come without any hang-ups about doing things in a particular way and without rigid mindsets. This fits in well with Amanresorts’ philosophy of creative and innovative service.
The right attitude was the key point when Adrian Zecha and Anil Thadani once stumbled upon a great front office desk clerk in a Sydney hotel whom they subsequently hired to run Amanpuri. He later developed into one of the best performing managers at one of the resorts.14
Furthermore, there is no written manual describing standard operating procedures (SOPs) nor are there any set ways of doing things. Sharon Howard, who has been associated with Amanresorts for the last 13 years training its staff, said: “Every employee is trained to be intuitive, to watch body language and not intrude, and it’s exciting that there’s no set way to do the job.”15Managers and staff are asked to run the resorts as if they were their own companies. This unique work culture has enabled Amanresorts to delight its high-paying guests ever since the inception of the brand.
Luxury private home
When Adrian Zecha started Amanpuri with just 40 rooms it was evident that it was going to target the ultra-premium customer segment of Hollywood stars, pop singers, sports icons and wealthy businesspeople. Given the limited number of rooms and the expensive luxury facilities provided, it had to be priced at the very upper end. This justified its target customers.
Another main attribute was the strategy of providing ultra-premium and
extremely personalized service to the limited number of guests at each resort. This belief was well captured when Adrian Zecha said: “Amanre- sorts is not a hotel company. We are a lifestyle company. When you visit, you should feel like you are staying at a very beautiful private home”.16At some properties, Amanresorts maintains a 6:1 employee guest ratio, some- thing that is unheard of in the hotel and resort industry.17
Every customer is treated the same, regardless of star, VIP or any other status. Ordinary people’s dreams of luxury and mingling with the stars are fulfilled by Amanresorts as comfortably as the VIPs’ desire to travel discreetly and incognito, and be treated like anyone else. This is often diffi- cult to provide with other large hotel chains.
With such a high commitment on delivering the brand promises, it is not surprising that Amanresorts has maintained a highly loyal customer base that keeps returning to one of the 15 Amanresorts to experience the paradise once again. They are also referred to as “Aman Junkies” and would come back year after year and/or try the latest resort regardless of its location.
One with nature – luxurious Aman-i-Khás (India) Courtesy Amanresorts
Holistic experience
The next main pillar of the branding strategy has been the holistic holiday experience, offered by blending comfort, personalized service and luxury with the culture and heritage of the locality. One of the main characteristics of any Amanresorts is the fact that the location of all the resorts has some historical background and importance. Amanresorts offers special guided tours to the surrounding areas of the resorts to explore the local traditions and culture through interaction with the local population. It also takes its guests on unique travel journeys around the resort. Before the opening of Aman-i-Khás in India, the French manager spent six months exploring the neighborhood for a radius of some 20 kilometers around the resort on a motorbike. He showed Anil Thadini, the co-founder of Amanresorts and himself a native Indian from the region, an abandoned village from the 12th century that everyone had forgotten about.18
The affluent guests at Amanresorts are used to all sorts of haute cuisine in their daily lives and most travel extensively on business, staying at hotels and eating at restaurants all year round. Therefore, Amanresorts provides no fancy food, but instead simple local cuisine prepared with fresh ingredi- ents served by local cooks to maintain the authenticity of the locality – to the great satisfaction of the guests who finally get a “home-cooked” meal.
Most guests do not leave the resorts to eat outside.
Exclusivity
The final brand pillar has been the exclusivity of Amanresorts. Given the high profile of Amanresorts’ clientele, it would have been easy for Amanre- sorts to capitalize on the presence of celebrities to gain worldwide publicity and media coverage in the global press. But in line with its overall strategy, Amanresorts has refrained from doing so. Amanresorts was never meant for the mass public and will never become so. It has been created for people who pay a high premium to have an experience of a lifetime. So the company has maintained a strict policy of exclusivity.19This policy has added to the over- all brand equity of Amanresorts and its 100,000 plus repeat customers.20
The company has put in place a system whereby all employees act as brand ambassadors. It has managed to do this not through any brand manu- als (by and large Amanresorts does not use manuals), but by being a respon- sive and caring employer. A case in point was when the bombs went off in
Successful Asian brand cases
143Bali in 2002, devastating the local tourism industry. Despite a financially crippling occupancy rate of 6 percent as a result of the terrorist acts, Aman- resorts did not lay off any staff. The management sent a clear signal to the organization and the local community that Amanresorts valued their contri- bution to the overall success of the company. Amanresorts has also invested a lot of time and effort in nurturing the leadership in its organization by regular training programs. In fact, each resort manager has become so attached to the resort that it has created a self-fulfilling culture.21With these measures, the management has been successful in aligning its entire staff with the activities of the organization. This will show companies aspir- ing to build successful brands the importance of balancing internal and external branding.
Amanresorts, by religiously practicing and consistently delivering on all four of its brand promises externally and aligning the commitment of its staff to its brand promises internally, has been able to build an almost iconic brand with a loyal customer base without resorting to the traditional ways of brand building.
Brand communication
Amanresorts is probably the only resort brand in the world to have achieved this iconic status with absolutely no advertising since its inception. Being true to its underlying philosophy of exclusivity, Adrian Zecha and his team decided against any form of advertising right from the start. The company does not send out press releases. The only brand communication that Amanresorts has made use of in the last 15 years is word of mouth. Ninety days before the opening of every Amanresort, the company sends out post- cards to its list of approximately 120,000 recipients with the new beautiful location shown but without mentioning the actual place, to tease the prospective customers in advance and create attention about the new resort.
In addition, loyal guests receive a periodic newsletter, Amannews, with descriptions of new properties and news about interesting historical or cultural events at existing properties.
In addition, Zecha invites a close circle of friends to experience the resort before it opens. This way news about the resort spreads quickly within the target segment of Amanresorts’ customers and also reaches exclusive travel media like Condé Nast Travelerand Andrew Harper’s Hideaway Report.
This exclusivity in itself entices more customers toward the Amanresorts’
brand. With leading Hollywood stars, pop singers and sports personalities visiting these resorts, it creates a desirable attribute for the brand in the eyes of prospective customers.
Future challenges Company culture
With its iconic status and following from all over the world and the cream of society being die-hard patrons of the brand, it seems that nothing will be able to challenge Amanresorts’ positioning. The biggest challenge will be to sustain the unique company culture and commitment to delivering the brand promise without manuals and detailed management practices. With success comes the obvious threat of copycats – different hotel and resort chains start- ing their own version of Amanresorts in an effort to give a similar paradise experience. Although so far no other resort chain is mentioned in the same breath as Amanresorts, it will indeed be a threat worth keeping an eye on.
Management
Another challenge will be to nurture a solid line-up of capable and passion- ate leaders who will be well equipped to carry the Amanresorts’ spirit forward after the first generation of managers led by Adrian Zecha fade out.
He turns 73 in 2006. This will probably be the most important crucial chal- lenge for the management, as the success of Amanresorts is totally depen- dent on the organization’s unique culture and philosophy. In addition to this, Adrian Zecha himself personifies the brand and is much admired and loved by the many loyal Aman junkies. Instilling this guiding philosophy in the next generation of leaders, who must not only abide by it but also be passion- ate about it, will decide the continuing success of Amanresorts in the future.